SOMALIA: Remittances and De-risking

In light of continuing concerns about the impact of de-risking on the remittance sector, the FATF and FSB, with the support of the GPFI and the German G20 Presidency, chaired a special session on remittances and de-risking with experts from the remittances and banking sectors (summary). The discussion aimed to understand how the money and value transfer services sector is affected by loss of correspondent banking services, and the variety of reasons why this can occur. It also reviewed the responses which have been used to address the causes, and maintain access to banking services and remittance services; and sought to identify any remaining gaps or co-ordination needs, at national or international levels that are not already covered by existing initiatives.

The decision by certain UK banks to close a significant proportion of their Somali Money Transfer Operator accounts from 2012 and subsequent legal action taken by Dahabshiil and others was a watershed in the de-risking debate, bringing it to public, political and regulatory attention (background). Concerns about the potential humanitarian catastrophe of global restriction on remittances have made up a substantial part of the narrative on de-risking impacts.

A framework is essential for banks to enjoy sufficient comfort in doing business with Somali remitters, given the associated Money Laundering/Terrorist Financing risks. Some Somali remittance companies are working towards establishing a full banking service in all jurisdictions.

The DfID and World Bank ‘Safer Corridor’ has apparently stalled; we are unlikely to get to a tested pilot; there is little to show. Informed by many interested parties, it was weak on what facts on the ground in Somalia suggested. Based on a Trusted Third Party structure and technology driven, it never got much past concept stage.

The UAE and Somalia authorities have been bound into this process after a fashion but they have little detail on the practicalities and tensions remain. The same goes for industry.  Legislation has been passed, and regulations drafted, but little has been implemented in a practical fashion, and the Financial Reporting Centre (FRC) has yet to generate action.  Despite efforts from US State Dept, there is still no common ID standard with which the remittance industry can work.

With its expertise in financial management capacity building, the World Bank and the US State Dept are well-placed to direct and coordinate efforts by governments, NGOs, banks, MTOs, as well as Somali communities locally and around the world. Success will depend on the quality of information sharing, dialogue with stakeholders and degree of collaboration – transparency is key at Somali Government and Central Banks level, as well as with the remittance industry.

It is hoped that the new Somali Government will be truly willing to grasp the nettle, despite looming meltdown in the industry as many companies lose their banking facilities in Dubai as well as in the UK, US, and Australia. Support for rapid incremental improvements on AML/CFT in the Somali territories has fallen victim to the emphasis on long-term financial governance, discouraging international banks and unsettling regulators.

Reaching for Occam’s Razor, we say ‘Keep it simple for now’. Whilst the local private sector may well be part of the problem it’s also the quickest short term solution; an improved status quo with the authorities facilitating low risk operations and assuring processes where required. Some remitters may well go out of business, but there are firms that can bear regulation. It requires work on risk and transparency in the ‘Second Mile’ and on regulation in the ‘Third Mile’ – all possible with effective partnership, thinking and working arrangements. Importantly, this path is in, our view, fully convergent with longer term governance goals.

Generating this short term to medium term breathing space is possible given a change of opinion in some quarters, not least towards industry-funded efforts. An immediate fix, involving use of non-conventional, public sector banking channels or more regulatory certainty for private sector banks, is unlikely without a firm high level direction to this effect.

To achieve this goal, the remittance industry needs to:

  • Improve their governance issues and hire experienced compliance officers and financial sector professionals in order to upgrade systems and processes;
  • Employ a reputable, internationally recognised audit company to review and advise on procedures;
  • Employ internationally recognised advisors (who are themselves consulted by the regulators) to review systems and processes at all 3 miles, and to work with the regulators and Central Banks at the 3rd mile;
  • Work with all donors, including World Bank, DfID, UNODC, USAID amongst others on the design and implementation of their programmes;
  • Retrain staff and agents at all locations to ensure that they understand and apply the compliance obligations and systems;
  • Review comparable systems in Pakistan and Afghanistan, where similar challenges exist, but where de-risking has been minimised.
  • Cooperate on the design and implementation of an end-to-end transaction data monitoring system, where data on every aspect of every transaction is available for interrogation by stakeholders.

Not all companies in the Somali remittance industry will have made the resources available to build all of the architecture for a fully compliant system.  Some companies will fall by the wayside, but it is to be hoped that smaller companies with a willingness to engage fully with recognised compliance procedures will be able to form consortia with larger and more established companies.






Support to Intelligence Agencies and Security Sector in nations in receipt of development assistance.


This paper sets out why and how HMG should increase efforts to support the reform of intelligence agencies and the security sector in countries in receipt of development assistance.


  •  Intelligence agencies are just as susceptible to poor governance and corruption as other security/state agencies and have a disproportionate impact on the standards of governance as a whole.  Thus a comprehensive approach to supporting democratic transition and improving governance should not only include such agencies but have a focus upon them.
  • To achieve the international community’s aims of deep-seated change in developing countries to create fully open, pluralist societies, thorough institutional reform, particularly of agencies that were critical to the preservation of dictatorship, is crucial.
  • Local ownership and democratisation should be the driver of reform, because the principal mechanism of change is that the sector senses and adapts to the day-to-day demands made on it by citizens.
  • While wholesale or radical reforms are required, external actors and donors are most likely to successfully gain support for such reforms by offering incremental and flexible support on core ‘day to day’ operations rather than wholesale top down change.
  • The fundamental governance challenge for intelligence/security agencies is to invest in an optimal mix of initiatives to facilitate the establishment of systems to motivate their officers to prioritise national security interests over their private interest, or the private interests of regime oligarchs.
  • External support needs to mitigate the risk that a reform programme will be designed precisely at the moment when local capacity to contribute, and to influence its design, is at its weakest, which might make the process inherently undemocratic.
  • External support needs to facilitate an architecture that would improve both the ability of the public to make its needs known and the ability of the security providers to take those needs into account in formulating security policies.
  • External support should focus on being attentive to and nurturing local initiatives and incipient reforms, which are much more context-specific than imported ideas. At the same time, training and capacity-building are essential to enable intelligence officers to generate such initiatives in the first place.
  • Capacity-building activities must be realistic, relevant to local context and designed to improve accountability as well as effectiveness; in addition, the political ramifications of capacity-building programmes must be understood and incorporated into programme risk management.


In all the countries in receipt of development assistance, the role of intelligence and security agencies will require drastic transformation. They will need to reorient themselves to the proper role of such agencies in a democratic state: protecting national security from serious threats such as terrorism, foreign espionage and major organised crime.

Such a wholesale reorientation faces entrenched challenges.  For example, the earlier transition in Iraq has demonstrated the tendency for new democratically elected leaders to seek to recast the newly formed Iraqi National Intelligence Service as an agency of state repression and control on traditional Middle Eastern Mukhābarāt lines. An earlier example that a ‘people’s revolution’ does not necessarily mean change in the nature of security agencies is provided in the case of Iran, where the overthrow of the Shah was partially due to hatred of the notorious SAVAK; the state’s intelligence and security agencies now very much resemble SAVAK in their disregard for individual rights.

The policy of the international community, as outlined at the recent G8 summit, is to encourage deep-seated reform in the developing world and the creation of fully open and pluralist societies, as opposed the short-lived democracies that preside over only cosmetic change. Thorough institutional reform, especially of agencies that were critical to the preservation of dictatorship, is thus crucial.

Of course, in addition to the challenge of re-orientation, intelligence organisations of developing nations face dramatic challenges relating to conflict, refugees and illegal migration, activities of local and trans-national criminal networks, political instability, peace building and state building, and democratic consolidation.  There are genuine capacity issues in attempting to carry out this multiplicity of responsibilities.

Further as recent events – from Egypt to Pakistan – have made clear, ambiguity on the role of intelligence and security agencies can directly threaten to derail ongoing transitions, and destabilize and reduce confidence in fragile regimes.  Such impacts are likely to be felt most keenly by two groups:

  • The poorest and most vulnerable sections of society.
  • The champions of reform.

In light of this it is the contention of this paper that the support to reform intelligence agencies should be a priority for western assistance to Arab and other countries in transition.


In other countries, the ‘emerging and post-conflict’ security and intelligence agencies have generally not received the same level of focus from the international security policy community as the defence and law enforcement sectors.  This at a time when agencies such as the Department for International Development (DfID) and the Foreign and Commonwealth Office (FCO) have increased their spending on the defence and law enforcement sectors.  In DfID’s case the increase has been marked and looks set to accelerate over the short to medium term.

The security and intelligence services are just as susceptible to poor governance and corruption as the other states agencies and a comprehensive approach to supporting democratic transition, and improved governance needs to include them.

The traditional reasons for reluctance on the part of agencies involved in aid and international development to engage fully in this arena are easy to understand but the time is now right for HMG to reconsider this stance: not least because the security and intelligence services have access to specialised tools for investigating networks of corrupt practice across the boundaries of host government sectors which could be of particular utility in preventing a slide back into corruption.

The challenges of intelligence agency reform

Of course security and intelligence agencies differ from other arms of Government in that their officials can view all attempts at reform as disguised attempts to infiltrate their ranks and steal their national security secrets and assets.  This section of the paper provides advice on how to mitigate this and other challenges in designing programmes of support for intelligence agencies.

One of the most important implications for intelligence agencies in developing nations is the risk that a reform programme or programmes will be designed precisely at the moment when local capacity to contribute, and to influence its design, is at its weakest, which makes the process inherently undemocratic.

Another key risk is that a reform programme underestimates the local context and its complexities by prioritising the institutional characteristics that the external reformers wish to introduce over those already present in the recipients’ societies.

It is an easy error to underestimate the complexity of managing the reform of public sector intelligence institutions in developing or post-conflict countries, operating in unpredictable contexts and aiming to meet a wide range of politically-contested objectives.  There will be grave shortcomings in all of the following areas:

  • The ability of security policy-making mechanisms to collate and understand a breadth of information, in particular from public expression of its security requirements, and incorporate that information into security policy decisions;
  • The capacity of security institutions to improve the management processes which underpin security provision;
  • The motivation of intelligence officers, agencies, and governments to change;
  • The fundamental connections to democracy;

Such shortcomings, and the absence of, or failure of these interactions have been clearly visible in developments in the so-called ‘Arab Spring’.

The security agencies completely missed the developing key factors that led to the uprisings, comprising:

  • the interrelationships between globalization and, amongst others;
  • the rupturing of corrupt political, economic and social systems dominated by authoritarian cliques;
  • tremendous social upheavals provoked by poverty, the evident injustice of crony capitalism, the rising expectations of the literate and internet-savvy young; and the delayed flowering of civil society.

The Intelligence agencies lacked any semblance of day-to-day anticipation of these local trends.

The sections below consider a range of insight into and approaches for overcoming the challenges and initiating a successful reform process.


Day to day management and local needs

This paper argues that a focus on the day-to-day local ownership of intelligence agency reform is appropriate.  For success donors should concentrate more on the dynamics of how the agencies respond to local needs and also press them to be less rigid in defining their desired outcomes in advance.

The focus of support should rely less on state level democratic reform and Western democratic rhetoric, and more on common sense and good management at the street level.

The paper suggests a way in which a security sector can evolve, over time, to be more fully responsive to the complexities of local needs which cannot possibly be fully understood in advance by either an external assistor or a member of the local elite.

Instead of seeing “local ownership” as a means to the end of implementing a programme of reform, this approach determines that local ownership and democratisation is the purpose of reform, because the principal mechanism of change is that the sector senses and adapts to the day-to-day demands made on it by citizens.

Organic development

Developed countries which enjoy well-managed intelligence and security agencies that meet the security demands of their populations have typically reached this stage not through a managed programme of reform activities, but because the social and political environments which influenced the organisations changed over time.  Moreover the organisations were willing or compelled to sense these changes and to respond to the new demands of the wider social and political environment by altering their structures, processes and behaviour.

These developments arose not as the result of a long-term strategy to produce a security sector which fulfilled certain criteria; rather, they grew organically in response to the demands of the circumstances and societies in which they were situated.

A top-down strategy of reform rather than a more organic approach can often change formal structures but has less impact on underlying incentives, power politics and culture.  The resulting security configurations may therefore be pleasing to Western donors, but may not be sustainable in the long term or effective in areas where the authority of national capitals is at best partial.

Thus external assistance should focus on being attentive to and nurturing local initiatives and incipient reforms, which are much more context-specific than imported ideas. At the same time, training and capacity-building are essential to enable people to generate such initiatives in the first place.


The tricky debate will lie in exactly what the role of these external actors in reform should be. In particular, should they solely facilitate a local process, and with whom, or should they also aim to introduce content and direction?

On the question of ‘with whom’, it would be possible to work with members of the local elite to implement their plans, which might produce results which were pleasing to the preferences of donors, but cannot be said to be truly representative or rooted in local structures.

Local ownership here is principally a (sometimes effective) consulting tactic and does little to increase democratic representation.  Or it would be possible to work with non-state security/justice systems (for example tribal Sheikhs in Yemen) which can be said to be more rooted in local structures, traditions and preferences.  For example DfID has supported traditional approaches to security, policing and justice in one of its largest SSR programmes in Sierra Leone for several years.

Leaders of security agencies will be partners in many cases but some of them may be discredited on account of their past activities and thus should not be cooperated with. For those who remain, anti-corruption activities could be an attractive new focus in tune with the new political dynamics.  Intelligence agencies often have the technological tools to detect corrupt activities. A greater role in this area could help them regain legitimacy.

Where (transitional) governments and their intelligence and security organs may lack legitimacy and accountability, and civil society itself encompasses a myriad of competing elements, the choice of partner, whether governmental or from civil society, will be a key decision which inevitably favours some groups over others.

Local and increasing ‘civilian’ ownership

By way of an illustration donors might assist in the design and development of a network of security committees at provincial and district levels to bring together security officials and representatives of civil society, and to establish channels of communication with an Office of National Security.

This move would extend the national security coordination function beyond the central government and involve the entire country in national security governance.

The resulting security architecture should provide opportunities for civil society involvement, with the local security committees serving as early warning mechanisms at the community level.

This architecture would improve both the ability of the public to make its needs known and the ability of the security providers to take those needs into account in formulating security policies.

Tapping into popular opinion

At present throughout the developing nations, little or no account is taken of popular opinion by the decision-makers for the establishment of strategic intelligence/security priorities, or for the allocation of resources or the implementation of security activity.

In none of the nations is there is a way of establishing methodically what sort of security the people want; and no mechanism exists within the decision-making process for the people’s view to be incorporated into policy.  Whether the people of a particular province feel terrorism is their key concern, or drug crime, or vandalism, or protection rackets, or declining social morality, the top management has no way of knowing: it has become simply a truism that the number one priority is fighting terrorism, or proliferation, or whatever.

Where there remains a requirement for brokering conflict resolution, a programme of external support should focus on creating civilian capability to collect and assess information and intelligence on security, economic, political and social issues in order to balance militia/military influence. The creation of such structures would aim to create the foundations for sophisticated strategic policy assessments and enable highly targeted security actions rather than indiscriminate militia responses. Even if this did not lead instantly to peace, it would at least lead to a lower intensity conflict with improved respect for human rights and fewer civilian casualties.

Where there is enduring conflict, the aim should be to increase the security policy options available to the (transitional) government, so that the pursuit of peace can be characterised by less indiscriminate militia action, more competent pursuit of peace negotiations, and an increasing role for civilian agencies rather than the military in delivering security.

There would be the opportunity for involving a much greater role for the police and for taking intelligence action against financial and procurement networks rather than using brute force against enemy fighters and their civilian neighbours. Political and security action would be carefully constructed to engage moderates and separate them from hardliners, rather than indiscriminately targeting both and increasing the numbers supporting the insurgency. Information, intelligence and good decision making would be critical to achieving all these aims.

For such an approach to work, the agencies must develop a range of capabilities that will often be unfamiliar in a reform environment.

  • First, the agencies must be able to measure and understand the security needs of the local population.
  • Second, they must have mechanisms to allocate resources to solving those needs.
  • Third, if the right initiatives are to be adopted and replicated, the system needs to be able to measure the impact of its operations in terms of delivering human security (not simply in terms of arrests made or insurgents killed).
  • Finally, the individuals who deliver positive results must be rewarded through an effective human resources system that is based on merit rather than patronage.

One of the stated objectives of SSR (as set out by the OECD Development Assistance Committee (DAC) guidelines) is to ensure that decision making and governance in the security sector conform to democratic norms. Much structural reform and legislation for intelligence and security agencies demands that the agencies share intelligence with each other, accept control and coordination from bodies including national security councils and relevant ministries, and provide sufficient information for parliamentary oversight bodies and judicial overseers to be able to discharge their duties.

Such reforms seem obvious and are essential if the agencies are to avoid duplication and if executive control and judicial and parliamentary oversight are to mean anything in practice. However, the provision of confidential materials outside an agency is fraught with dangers for a diligent intelligence or security official. Will the receiving institution protect the material properly? To do so, the receiving institution must use the same level of security protection as the agency — they must vet staff to the same standard, they must use the same system of secure communications, they must even have the same quality of combination locks on their filing cabinets. Thus this is a path down which one must tread very carefully indeed.

Engaging reform leaders

One approach to engage political leaders in reform of intelligence agencies is to initiate debate on the appropriate legal basis for the activities of such agencies, as well as parliamentary oversight. For example in Britain the Security Service Act defines their role as being “the protection of national security and, in particular, its protection against threats from espionage, terrorism and sabotage, from the activities of agents of foreign powers and from actions intended to overthrow or undermine parliamentary democracy by political, industrial or violent means.”

The UK Act establishes an independent committee of Members of Parliament from different parties to oversee the security services and their adherence to the law.  This is an approach that could also be followed in many developing nations. Legislation and oversight can be accompanied by a commitment to a clear set of values, for example:

  • legality;
  • integrity;
  • objectivity;
  • a sense of proportion about their work; and
  • respect and consideration for those with whom they work.

Building capacity, competency and incentive structures

A successful programme will require the development of a complex range of building block capacities within the intelligence/security agencies and their overseeing bodies.

Some of these tasks are mundane, such as disciplined and security conscious paper file management; others are extremely complex, such as strategic planning, the creation of locally relevant metrics for human security and the establishment of systems to motivate public servants to prioritise such targets over their private (and possibly corrupt) interests.

Clearly effective incentives will need to create or strengthen, at the level of the individual officer and at the level of the agencies and the system, some willingness to act as public servants and not solely pursue selfish individual needs, seek only to prop up an existing regime or support the interests of one’s own socioeconomic or ethnic group.

Implementation requires a fine balance of top-down strategy and bottom-up innovation. Above all, it entails a detailed programme of change management. A great deal of work has been done on such questions of incentives, strategy and change by business schools, economics departments and management consultancies, which have developed a range of well-documented approaches that have been tested in private and public sector organizations.

DfID, for example, has let and managed dozens of major change management and institutional strengthening contracts in the Middle East and elsewhere and DfID’s contractors have significant expertise in these areas.  This is expertise that has been missing in the intelligence agency to intelligence agency support programmes to date.

The possible ways of creating positive incentives within an institution, or introducing disincentives for undesired behaviour such as corruption are many. But basic good personnel management, in which performance is accurately measured against objective criteria and rewarded by promotion or other means, will clearly point the process in the right direction.

The failure to properly reward merit is often a result of disorganisation and lack of capability rather than a deliberate attempt to reward negative behaviour. It is a further argument for strengthening the basic managerial skills of an institution, even if one does not know exactly how those skills will be used or what sort of organisation they will produce.

Capacity-building activities must be realistic, relevant to local context and designed to improve accountability as well as effectiveness; in addition, the political ramifications of capacity-building programmes must be understood and incorporated into programme risk management.  This capacity building ‘facilitation’ will have a profound effect on the agency’s political power lines. Human resource management is a way of ensuring regularised, accountable allocation of people to tasks.

A coherent human resources management system, where job specifications are matched to individuals’ competencies and experience within a commonly understood framework, threatens the system of patronage and nepotism on which many developing states’ national institutions are based. In short, it is essential that the programme takes account of the effect not only of politics on the reform process, but also of the reform process on the politics.

A balance must be struck in not overburdening the system with new policies and regulations.  This is a process of change management. The required change is both institutional and individual, and all agencies need training for this as they go through the reform process.  Development of ethics based prevention through raising integrity levels means building clarity and understanding, cooperation, openness and trust, transparency, information- through setting standards, education, training and accountability, and promoting leadership on these matters.

The fundamental governance challenge for any intelligence/security organisation is to invest in an optimal mix of initiatives to facilitate the establishment of systems to motivate their officers to prioritise national security interests over their private interest.  This will involve a mix of the following:

Building integrity – increase the moral burden of bad behaviour through;

  • Ethics training and education,
  • Codes of conduct for intelligence officials,
  • An ethos of public service,
  • Leadership by example,
  • Commitments to honour, duty, and country.

Increasing transparency – increase the probability of detection of bad behaviour through;

  • Strategic planning, budgeting, and resource allocation mechanisms,
  • Accounting and information systems,
  • Financial and management audits (internal and external),
  • Open and competitive procurements,
  • Streamlined rules and regulations, policies, and procedures,
  • Appropriate Public access to information and appropriate relationships with the Media.

Improving accountability – increase expected punishment through legal and judicial reforms that;

  • Raise the probability of conviction if detected,
  • Increase the penalties if convicted.


Whilst these are noble aims, in the short to medium term it will be difficult to achieve them in many countries in receipt of development assistance. An overly theoretical as opposed to pragmatic  approach to reform carries the risk of making responsive delivery of security a hostage to progress on more fundamental and complex political reform; or, worse, of encouraging outside actors to build a semblance of a democratic architecture for security institutions to be accountable to, where no genuine democratic legitimacy exists.

Progress may be quicker, and democracy in its true sense might be better served, by increasing the capacity of security forces to respond to the public in a more direct way than at state level, and in a manner which reflects their day-to-day role as public servants.


Somali Remittance Pathways

I wanted to share with you a tool that we have been using with key stakeholders and which you may find useful in representing to interlocutors the overall cash flow management process on which the Somali remittance industry depends. I know that many people to whom I speak find the cash/value management confusing, and this tool has been helpful in explaining the process in simple terms. Obiter Consult Ltd work on building the capacity, effectiveness, and oversight of the checks and balances at each of the hubs identified in the accompanying tool which we have uploaded to ‘youtube’ for convenience: https://www.youtube.com/watch?v=sZ76yfpr8qE

How to begin to explain the structure of the typical Somalia remittance corridors from multiple originating countries, utilising the UAE as the centre for management of cash-flow mismatches versus remitter to recipient value transference?


  1. Movement of Value.

Remitter 1 is a Somali living abroad, perhaps in Bristol who wants to send small sums of money back to the family (Recipient 1) in Mogadishu. The MTO in Somalia contacts Recipient 1, who after identifying themselves collects the cash intended for them in ($). The timescale for this activity may be very short.

Remitter 2 is a Somali businessman living in Mogadishu (note the briefcase) who intends to procure products from overseas (probably Dubai because of cost and proximity) for sale in Somalia. Remitter 2 takes cash ($) to the local office of a Somali MTO and passes the contact details of the company (Recipient 2) from whom he intends to procure his goods plus administrative details (pre-payment invoice, source of funds, etc) to the MTO. The MTO in Dubai contacts Recipient 2 and having matched up the administrative details (to comply with AML/CFT regulations) who collects the ($) and arranges for despatch of the goods to Remitter 1. The timescale for this activity may be very short.

  1. Movement of cash.

The (£) cash deposited by Remitter 1 (along with cash collected from many other Somali remitters in the locality) is transported by road to London to the premises of a Money Services Bureau (MSB) such as Moneycorp or Choice. The MSB converts the (£) cash into ($) in their bank account. The MSB instructs the bank to make a ($) bank transfer to the Dubai bank account of the MTO.

  1. Transfer of Value and Cash-Flow Management after settlement of all transactions.

Recipient 1 in Somalia receives his cash ($) from the MTO in Somalia, who draws upon the funds deposited with him by Remitter 2. Because of the absence of a banking infrastructure in Somalia, no cash is transported in or out of Somalia (except occasionally when there is an imbalance which results in the need to manage cash-flow shortfall or surplus in the UAE and cash-flow shortfall or surplus in Somalia).

The overall combination of the 2 processes (Transfer of Value and Cash-Flow Management) after settlement of all transactions, and inclusion of the mismatch net to zero.

Funds transferred from the UK terminate in the UAE and are used to settle the delivery of funds to recipients that are remitted from Somalia. And funds transferred from Somalia are used to pay recipients in Somalia of funds transferred from the UK.

The presentation depicts two processes happening concurrently. TRANSFER OF VALUE represents the transfer of value from a Remitter 1 in the UK to the intended Recipient 1 in Somalia and the transfer of value from a business Remitter 2 in Somalia to the intended trading Recipient 2 in the UAE. TRANSFER OF CASH represents the movement of physical cash and/or electronic transfers bank to bank. The management of cash surpluses and shortfalls in both the UAE and Somalia is a necessity because of the absence of a viable financial sector in Somalia.

Importantly, the two processes combined represent CASH-FLOW MANAGEMENT and if the amounts being remitted from the UK happen to equal the amounts being remitted from Somalia, then the net position will equal zero after all remittances are settled.